Smart Meters: PG&E Plans to Give Customers a Choice -- at a Cost

If you're like most consumers, you probably haven't given much thought to your electricity and gas meters. But in California, enough ratepayers have taken exception to new smart meters that regulators have forced the state's largest utility to give homeowners a choice of meters.

The Pacific Gas and Electric Co. (PCG) proposed a plan Thursday that will allow residential customers to opt out of getting smart meters or, if they already have smart meters installed, to switch them off.

Earlier this year, The California Council on Science and Technology issued a report concluding that smart meters' radio-frequency emissions pose no known health risks and are lower than less than those from cell phones and microwaves. But the report wasn't enough to calm some people's concerns. So the president of the California Public Utilities Commission asked PG&E to come up with alternatives to smart meters.

What Makes Them Smart?

Unlike regular meters, which typically require utility workers to read them manually every month, so-called smart meters come with electronics that enable them to wirelessly report energy use throughout the day, as well as outages or other problems.

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These meters have the potential to benefit both consumers and utilities: They could make it possible for customers to get, say, hourly updates of their energy use and information about how they could cut their electricity and gas use. And the meters could give utilities more information about energy demand and delivery troubles, helping them to manage the grid more efficiently.

PG&E, based in San Francisco, has installed about 8 million smart meters since 2006, when it began rolling them out as part of a $2.2 billion program. Its original goal was to install 10 million by the end of 2012.

The Price of Intelligence

PG&E is hardly the only utility to face resistance from their customers and regulators over smart meters. As many utilities across the country roll out smart meters -- or create plans to do so -- controversy over the meters has cropped up in Maryland, Colorado, Michigan, Hawaii, Indiana and other states.

It's not all about health, either; in many cases, the concern has been about cost. Lawsuits have been filed over the accuracy of the smart meter readings and whether utilities have overcharged their customers.

After all, one of the selling points of smart meters has been the potential energy and cost savings for consumers. But it costs money to install the meters, and utilities typically pass on part of those costs to their customers. In spite of that expense, utilities and smart-meter makers contend that consumers will see lower utility bills over time because they will become more mindful of how much they spend on energy daily.

Some consumers and regulators question whether the savings will really happen, though, particularly if people have to pay close attention to their energy use and change their behavior in order to save money.

Your Options

But with PG&E's proposal, consumers also could be in for higher bills if they opt out of smart meters. For PG&E customers who don't want smart meters but already have them installed, the utility is proposing to turn off the radio-frequency function -- at a cost. It would charge these customers an upfront fee, as well as ongoing fees, for turning off the radio, reading the meters manually and managing this new set of meters and customers.

The utility has laid out different proposed fees for different types of customers, such as low-income families. If the utilities commission approves the plan, people who want the radio off also will be able to choose between either paying a higher upfront fee and lower ongoing costs or a lower initial fee and higher monthly costs.

The upfront charges range from $105 to $270. The ongoing fees vary depending on whether customers opt for a fixed monthly cost ($11 to $20) or a fee based on their gas or electric use.

For those concerned about the health risks, but who don't want to pay these fees, there's also another option: Customers can ask PG&E to relocate their smart meter to another part of their property. The utility already has a program in place to make this change possible.